Canadian Shells

[Tackler]

CLPh Calypso settles debt, arranges financing

2005-06-02 20:22 ET - News Release

Mr. John Gill reports

DEBT SETTLEMENT AND PRIVATE PLACEMENT

Calypso Acquisition Corp. has negotiated the settlement of approximately $140,000 in debt owed to arm's-length parties, by the issuance of units at eight cents per unit, each unit comprising one share and one share purchase warrant exercisable at 10.5 cents per share for a period of 12 months.

The company has also negotiated a non-brokered private placement of 4,375,000 units at eight cents per unit to raise gross proceeds of $350,000 and a convertible loan of $150,000. Proceeds of the private placement and convertible loan will be used for working capital.

Each unit issuable in the private placement will comprise one share and one share purchase warrant, each warrant exercisable to acquire one additional share at a price of 10.5 cents for a period of 12 months. Proceeds of the private placement will be used for working capital. A finder's fee will be payable in accordance with NEX policies.

The convertible loan will be for a term of two years and bear interest at the rate of London Interbank Offered Rate (LIBOR) plus 2 per cent per year. Principal and interest outstanding under the loan will be convertible into units of the company at 10.5 cents per unit, each unit comprising one share and one share purchase warrant, each warrant exercisable to acquire one additional share for 12 months at 10.5 cents per share. A finder's fee will be payable in accordance with NEX policies.

The transactions are all subject to regulatory approval. The company is continuing its review of possible acquisition opportunities.

The company has been advised by its controlling shareholder, Brazilia Holdings Ltd., that it has sold the shares it holds in the company to a number of unrelated accredited investors.